Income taxes: credits: California New Markets Tax Credit.

Existing federal law allows a New Markets Tax Credit to a taxpayer holding a qualified equity investment in an amount equal to the applicable percentage of the amount paid to the qualified community development entity for investment in low-income communities. The state Personal Income Tax Law and the Corporation Tax Law allow various credits against the taxes imposed by those laws. This bill would allow a California New Markets Tax Credit under the Personal Income Tax Law and the Corporation Tax Law, in modified conformity with the federal New Markets Tax Credit, for taxable years beginning on or after January 1, 2021, and before January 1, 2026, in a specified amount for investments in low-income communities. The bill would limit the total annual amount of credit allowed pursuant to these provisions to $50,000,000 per calendar year. The bill would impose specified duties on the Governor's Office of Business and Economic Development (GO-Biz) with regard to the application for, and allocation of, the credit. The bill would require GO-Biz to establish and impose reasonable fees upon entities that apply for the allocation of the credit, to be deposited in the California New Markets Tax Credit Account established by the bill within the California Economic Development Fund, and use the revenue, upon annual appropriation by the Legislature, to defray the cost of applying to and administering the credits, as specified. The bill would only authorize the allocation for these credits for those taxable years for which moneys are appropriated to GO-Biz to administer these credits for those taxable years. Existing law requires any bill authorizing a new tax expenditure, including income tax credits under the Personal Income Tax Law and the Corporation Tax Law, to contain, among other things, specific goals, purposes, and objectives that the new tax expenditure will achieve, detailed performance indicators, and data collection requirements, as provided. This bill would also include that additional information required for any bill authorizing a new tax expenditure. The bill would provide that its provisions are severable. This bill would take effect immediately as a tax levy.